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Monday, September 29, 2014

Debt Snowball- Another One Bites the Dust!

This is a portion of the "book" of claims associated with the pregnancy, birth, and Tennyson's hospitalizations. You know it's bad when the claim recaps arrive by a shipped package instead of through the regular mail.

When the bills hit following my high-risk pregnancy, c-section, and four weeks of hospitalization for Tennyson, they hit hard. One evening while paying bills I realized I had spent over an hour clicking "submit" and writing checks. I then counted the billing statements piled up to my side- 22. We were paying 22 bills each month! I've long been on the side of wanting less debt in our lives. Now, we needed less debt. Just keeping up with all the statements that arrived throughout the month was a nightmare. Yet, I've been told several times to "not worry about it" and to "just pay something no matter how small the amount." Ugh, such bad advice. First, not everyone will accept just any amount. Nearly all of the bills required a $25-50/month minimum payment (uh huh..do the math). Second, debt should be something to be concerned about. If we just didn't worry about it then we'd eventually find ourselves stretched too thin and living paycheck to paycheck. Opportunities, including that of working within the home and affording additional children, would be severely limited. I ended that evening of bill paying with a good laugh at the ridiculousness of it all and a resolve to see it gone. My plan has been to use the debt snowball method. I rank all the bills according to amount, smallest to largest. Each time I finish paying a bill, I first and foremost resist the temptation to consider it as funds gained. Then, I apply it to the minimal payment of the next bill. Little by little the giant stack of twenty-two bills is getting smaller. Bills are being paid off completely years sooner than the minimal payment plan! That's an incredible burden lifted and life regained! Despite the debt-elimination motivation gained from current progress, we still aren't aiming at being completely debt free. We desire to focus on being debt-limited and continue allowing our family to grow. Since we know that all pregnancies will be high-risk and followed by a premature c-section birth and NICU stay, we do have to be mindful of finances. We want the expenses from one child to be manageable, so that we could then safely take on additional expenses associated with another child. Waiting until one child's expenses is completely paid before having another child would risk not having that additional child at all (did you see the giant stack in the photo?!). Honestly, it's freeing to know that we are making choices that permit us to continue to accept a child whenever God see's fit. (It's also freeing to know that I don't have to keep up with paying twenty-two bills every month!). Hooray for making progress! :)

1 comment:

Congratulations on your progress! I definitely know how freeing it is to see your debt finally start going away little by little. It is true that every little bit is progress. I have a spreadsheet I've always kept of our debt (every payment and the total debt balance when I made the payment). Seeing that number get smaller and smaller has been such an encouragement over time. I commend your hard work and pray God will honor that with His financial resources. I truly believes he helps us as we work to use His resources responsibly